U.S.
SECURITIES AND EXCHANGE COMMISSION


Washington,
D.C. 20549


FORM
10-Q





x QUARTERLY REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934





For the
quarterly period ended: December 31, 2008





 ̈ TRANSITION REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF
1934





Commission
file number: 000-53326





DRC VENTURES, INC.


(Exact
name of registrant as specified in its charter)




Nevada
              
              26-2423443(State
      or other jurisdiction of
              
              (I.R.S.
      Employerincorporation
      or organization)
              
              Identification
      No.)





86 South Centre Avenue,
Rockville Centre, NY 11570


(Address
of principal executive offices)





(516)
594-4401


(Issuer's
telephone number)







(Former
name, former address and former


fiscal
year, if changed since last report)





Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days. x  Yes    ̈  No





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.





Large
      accelerated filer    ̈
              Accelerated
      filer      ̈Non-accelerated
      filer      ̈  (Do
      not check if a smaller reporting company)
              Smaller
      reporting company     x





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). xYes  ̈No





APPLICABLE
ONLY TO ISSUERS INVOLVED IN BANKRUPTCY


PROCEEDINGS
DURING THE PRECEDING FIVE YEARS





Indicate
by check mark whether the registrant has filed all documents and reports
required to be filed by Section 12, 13 or 15(d) of the Securities Exchange Act
of 1934 subsequent to the distribution of securities under a plan confirmed by a
court. ̈  Yes    ̈  No





APPLICABLE
ONLY TO CORPORATE ISSUERS





State the
number of shares outstanding of each of the issuer's classes of common equity,
as of the latest practicable date:  At February 11, 2009 there were
1,000,000 shares of common stock outstanding.










PART
I — FINANCIAL INFORMATION




Item 1.
Financial Statements.




PageBalance
      Sheet – December 31, 2008 (Unaudited)
              
              F-1Statement
      of Operations for the three months ended December 31, 2008 (Unaudited) and
      Since inception (April 15, 2008) (Unaudited)
              
              F-2Statement
      of Stockholders Deficit
              
              F-3Statement
      of Cash Flows for the three months ended December 31, 2008 (Unaudited) and
      Since inception (April 15, 2008) (Unaudited)
              
              F-4Notes
      to Financial Statements (Unaudited)
              
              F-5





1




DRC
      Ventures, Inc.Balance
      Sheet-Unaudited(A
      Development Stage Company)As
      of December 31, 2008
 
 ASSETSCURRENT
      ASSETSCash
                                  
                                  $
                                  11TOTAL
      CURRENT ASSETS
                                  
                                  
                                  11TOTAL
      ASSETS
                                  
                                  
                                  11LIABILITIES AND STOCKHOLDERS'
      DEFICITLIABILITIESCURRENT
      LIABILITIESShareholder
      Loan
                                  
                                  $
                                  9,820Accrued
      Expenses
                                  
                                  
                                  699TOTAL
      CURRENT LIABILITIES
                                  
                                  
                                  10,519TOTAL
      LIABILITIES
                                  
                                  
                                  10,519STOCKHOLDERS'
      DEFICITPreferred
      stock ($0.0001 par value; 10,000,000 shares authorized;none
      issued and outstanding at December 31, 2008)
                                  
                                  
                                  -Common
      stock ($0.0001 par value; 100,000,000 shares authorized;1,000,000
      shares issued and outstanding at December 31, 2008)
                                  
                                  
                                  100Stock
      Subscription Receivable
                                  
                                  
                                  (100
                                  )Retained
      Deficit
                                  
                                  
                                  (10,508
                                  )TOTAL
      STOCKHOLDERS' DEFICIT
                                  
                                  
                                  (10,508
                                  )TOTAL
      LIABILITIES AND STOCKHOLDERS' DEFICIT
                                  
                                  $
                                  11
  F-1
 
 DRC
      Ventures, Inc.Statement
      of Operations-Unaudited(A
      Development Stage Company)
 
 For the Three
                        
                        
                        Cumulative totalMonths Ended
                        
                        
                        since inceptionDecember 31, 2008
                        
                        
                        April 15, 2008REVENUES:Income
                        
                        $
                        -
                        
                        
                        $
                        -Total
      Revenue
                        
                        
                        -
                        
                        
                        
                        -EXPENSES:Professional
      Fees
                        
                        
                        500
                        
                        
                        
                        9,495Interest
      Expense
                        
                        
                        200
                        
                        
                        
                        600Selling,
      General, and Administrative
                        
                        
                        413
                        
                        
                        
                        413Total
      Expenses
                        
                        
                        1,113
                        
                        
                        
                        10,508NET
      INCOME/(LOSS)
                        
                        $
                        (1,113
                        )
                        
                        $
                        (10,508
                        )Basic
      and fully diluted net loss per common share:
                        
                        $
                        (0.001
                        )
                        
                        $
                        (0.011
                        )Weighted
      average common shares outstanding
                        
                        
                        1,000,000
                        
                        
                        
                        1,000,000
  F-2
 
 DRC
      Ventures, Inc.Statement
      of Stockholders' Deficit-Unaudited(A
      Development Stage Company)
 
 AdditionalCommon
      Stock
                  
                  
                  Preferred
      stock
                  
                  
                  Paid-in
                  
                  
                  DeficitShares
                  
                  
                  Amount
                  
                  
                  Shares
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  AccumulatedBalances,
      April 15, 2008 (Inception)
                  
                  
                  -
                  
                  
                  $
                  -
                  
                  
                  
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -Net
      income/(loss) for the period
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (10,508
                  )Issuance
      of common shares
                  
                  
                  1,000,000
                  
                  
                  
                  100
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -Balances,
      December 31, 2008
                  
                  
                  1,000,000
                  
                  
                  $
                  100
                  
                  
                  
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  (10,508
                  )
  F-3
 
 DRC
      Ventures, Inc.Statement
      of Cash Flows-Unaudited(A
      Development Stage Company)
 
 For the Three
                                
                                
                                Cumulative TotalMonths Ended
                                
                                
                                Since InceptionDecember 31, 2008
                                
                                
                                April 15, 2008CASH FLOWS FROM OPERATING
      ACTIVITIES:Net
      loss
                                
                                $
                                (1,113
                                )
                                
                                $
                                (10,508
                                )Adjustments
      to reconcile net loss to net cash provided by (used in)operating
      activities:Changes
      in Assets and Liabilities:Increase/(decrease)
      in Accrued Expenses
                                
                                
                                299
                                
                                
                                
                                699NET
      CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
                                
                                
                                (814
                                )
                                
                                
                                (9,809
                                )CASH FLOWS FROM INVESTING
      ACTIVITIES:Shareholder
      Loan
                                
                                
                                820
                                
                                
                                
                                9,820NET
      CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES
                                
                                
                                820
                                
                                
                                
                                9,820NET
      INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
                                
                                
                                6
                                
                                
                                
                                11CASH
      AND CASH EQUIVALENTS,BEGINNING
      BALANCE
                                
                                
                                5
                                
                                
                                
                                -ENDING
      BALANCE
                                
                                $
                                11
                                
                                
                                $
                                11SUPPLEMENTAL
      DISCLOSURES OF CASH FLOW INFORMATION:CASH
      PAID DURING THE PERIOD FOR:Interest
                                
                                $
                                -
                                
                                
                                $
                                -Taxes
                                
                                $
                                -
                                
                                
                                $
                                -
  F-4
  DRC
VENTURES, INC.
 NOTES
TO THE UNAUDITED FINANCIAL STATEMENTS
 AS
OF DECEMBER 31, 2008
 
 NOTE A—SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES
 
 Business Activity—DRC
Ventures, Inc. (the "Company”) was organized under the laws of the State of
Nevada on April 15, 2008 as a corporation.  The Company’s objective is
to acquire or merge with a target business or company in a business
combination.
 
 Basis of
Presentation—The financial statements included herein were prepared under
the accrual basis of accounting.
 
 Cash and Cash
Equivalents—For purposes of the Statement of Cash Flows, the Company
considers liquid investments with an original maturity of three months or less
to be cash equivalents.
 
 Management’s Use of
Estimates—The preparation of financial statements in conformity with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosures of contingent assets and
liabilities at the date of financial statements and the reported amounts of
revenues and expenses during the reporting period.  Actual results
could differ from those estimates.  The financial statements above
reflect all of the costs of doing business.
 
 Revenue
Recognition—The Company’s policy is to recognize income when it is
earned.
 
 Comprehensive Income
(Loss)—The Company adopted Financial Accounting Standards Board Statement
of Financial Accounting Standards (SFAS) No. 130, “Reporting Comprehensive
Income”, which establishes standards for the reporting and display of
comprehensive income and its components in the  financial
statements.  There were no items of comprehensive income (loss)
applicable to the Company during the period covered in the financial
statements.
 
 Net Income per Common
Share—Statement of Financial Accounting Standard (SFAS) No. 128 requires
dual presentation of basic and diluted earnings per share (EPS) with a
reconciliation of the numerator and denominator of the EPS
computations.  Basic earnings per share amounts are based on the
weighted average shares of common stock outstanding.  If applicable,
diluted earnings per share would assume the conversion, exercise or issuance of
all potential common stock instruments such as options, warrants and convertible
securities, unless the effect is to reduce a loss or increase earnings per
share.  Accordingly, this presentation has been adopted for the period
presented.  There were no adjustments required to net income for the
period presented in the computation of diluted earnings per share.
 
 Deferred
Taxes
 Income
taxes are provided in accordance with Statement of Financial Accounting
Standards No. 109 (SFAS No. 109), “Accounting for Income
Taxes.” A deferred tax asset or liability is recorded for all temporary
differences between financial and tax reporting and net operating loss-carry
forwards.
 
 Deferred
tax assets are reduced by a valuation allowance when, in the opinion of
management, it is more likely than not that, some portion or all of the deferred
tax asset will not be realized. Deferred tax assets and liabilities are adjusted
for the effect of changes in tax laws and rates on the date of
enactment.
  F-5
  NOTE A—SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES (CONT.)
 
 Fair Value of Financial
Instruments—The carrying amounts reported in the balance sheet for cash,
accounts receivable and payable approximate fair value based on the short-term
maturity of these instruments.
 
 Accounts
Receivable—Accounts deemed uncollectible are written off in the year they
become uncollectible.  As of December 31, 2008 the balance in Accounts
Receivable was $0.
 
 Impairment of Long-Lived
Assets—The Company evaluates the recoverability of its fixed assets and
other assets in accordance with Statement of Financial Accounting Standards No.
144, “Accounting for the
Impairment or Disposal of Long-Lived Assets” (“SFAS 144’). SFAS 144
requires recognition of impairment of long-lived assets in the event the net
book value of such assets exceeds its expected cash flows, it is considered to
be impaired and is written down to fair value, which is determined based on
either discounted future cash flows or appraised values. The Company adopted the
statement on inception. No impairments of these types of assets were recognized
during the period ended December 31, 2008.
 
 Stock-Based
Compensation—The Company accounts for stock-based compensation using the
fair value method of Financial Accounting Standard No. 123R.  This
Statement requires a public entity to measure the cost of employee services
received in exchange for an award of equity instruments based on the grant-date
fair value of the award (with limited exceptions).  That cost will be
recognized over the period during which an employee is required to provide
service in exchange for the award—the requisite service period (usually the
vesting period).  No compensation cost is recognized for equity
instruments for which employees do not render the requisite
service.
 
 Recent Accounting
Pronouncements—In March 2008, the FASB issued Statement of Financial
Accounting Standards No. 161, “Disclosures about Derivative Instruments and
Hedging Activities—an amendment of FASB Statement No. 133”.  This
statement requires enhanced disclosures about an entity’s derivative and hedging
activities and thereby improves the transparency of financial
reporting.  This Statement changes the disclosure requirements for
derivative instruments and hedging activities. Entities are required to provide
enhanced disclosures about (a) how and why an entity uses derivative
instruments, (b) how derivative instruments and related hedged items are
accounted for under Statement 133 and its related interpretations, and (c) how
derivative instruments and related hedged items affect an entity’s financial
position, financial performance, and cash flows.  This Statement is
effective for financial statements issued for fiscal years and interim periods
beginning after November 15, 2008, with early application encouraged. This
Statement encourages, but does not require, comparative disclosures for earlier
periods at initial adoption. The adoption of this standard is not expected to
have a material effect on the Company’s results of operations or financial
position.
 
 NOTE B—SUPPLEMENTAL CASH
FLOW INFORMATION
 
 Supplemental
disclosures of cash flow information for the period from April 15, 2008
(Inception) through December 31, 2008 are summarized as follows:
 
 Cash paid
during the period from April 15, 2008 through December 31, 2008 for interest and
income taxes:
 
 Income Taxes
                    
                    $
                    —Interest
                    
                    $
                    —
  F-6
  NOTE C—SEGMENT
REPORTING
 
 In June
1997, the Financial Accounting Standards Board issued Statement of Financial
Accounting Standards No. 131, “Disclosures about Segments of an
Enterprise and Related Information.”  This statement requires
companies to report information about operating segments in interim and annual
financial statements.  It also requires segment disclosures about
products and services, geographic areas and major customers.  The
Company determined that it did not have any separately reportable operating
segments as of December 31, 2008.
  NOTE D—GOING
CONCERN
 
 As shown
in the accompanying audited financial statements, the Company has a loss of
$1,113 for the three months ended December 31, 2008 and a net accumulated
deficit of $10,508 since inception and has yet to generate an internal cash
flow.   These factors raise substantial doubt about the Company’s
ability to continue as a going concern.
 
 Management’s
plans in regard to this matter are to raise equity capital and seek strategic
relationships and alliances in order to increase sales in an effort to generate
positive cash flow.  Additionally, the Company must continue to rely
upon equity infusions from investors in order to improve liquidity and sustain
operations.  The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
 
 NOTE
E—COMMITMENTS
 
 As of
December 31, 2008, the Company had no commitments.
 
 NOTE F—CAPITAL
STOCK
 
 The
Company is authorized to issue 100,000,000 common shares at $.0001 par value per
share.
 
 During
the period from April 15, 2008 (Inception) through December 31, 2008, the
Company issued 1,000,000 to the following:
 
 Name
                                
                                Number of shares
                                
                                Cash or Services
                                
                                Price per share
                                
                                
                                Total valueDavid
      Powell
                                
                                
                                500,000
                                
                                founder
      shares
                                
                                $
                                0.0001
                                
                                
                                $
                                50.00Ronald
      Williams
                                
                                
                                500,000
                                
                                founder
      shares
                                
                                $
                                0.0001
                                
                                
                                $
                                50.001,000,000
                                
                                
                                
                                
                                
                                
                                
                                $
                                100
 
 Payment
for the above shares was not received as of December 31, 2008, and the Company
set up a Stock Subscription Receivable account in the Equity section of the
Balance Sheet.  As of December 31, 2008, $100 was outstanding for
these 1,000,000 shares.
 
 The
Company is authorized to issue 10,000,000 preferred shares at $.0001 par value
per share.  During the period from April 15, 2008 through December 31,
2008, the Company issued no preferred shares.
  F-7
  NOTE G – DEVELOPMENT STAGE
COMPANY
 
 The
Company is in the development stage as of December 31, 2008 and to date has had
no significant operations.  Recovery of the Company’s assets is
dependent on future events, the outcome of which is indeterminable. In addition,
successful completion of the Company’s development program and its transition,
ultimately, to attaining profitable operations is dependent upon obtaining
adequate financing to fulfill its development activities and achieving a level
of sales adequate to support the Company’s cost structure.
 
 NOTE I—SHAREHOLDER
LOAN/RELATED PARTY
  The
Company has signed a series of promissory notes with a related party evidencing
loans made to the Company during 2008.  The total principal amount of
the loans is $9,820 and is payable on demand.  The annual interest
rate on the note is 8%.  Accrued interest not paid as of December 31,
2008 is $600.
  F-8




Item
2. Management’s Discussion and Analysis or Plan of Operation.





Overview.





DRC
Ventures, Inc. (“we”, “us” or the “Company”) was organized in the State of
Nevada on April 15, 2008 to serve as a vehicle to acquire, through a reverse
acquisition, merger, capital stock exchange, asset acquisition or other similar
business combination (“Business Combination”), an operating or development stage
business ("Target Business") which desires to utilize our status as a reporting
corporation under the Securities Exchange Act of 1934.  We have
neither engaged in any operations nor generated any revenues since our
inception.





We are
currently in the process of evaluating and identifying targets for a Business
Combination.  We are not presently engaged in, and will not engage in,
any substantive commercial business unless and until we consummate a Business
Combination.





Our
management will have broad discretion in identifying and selecting a prospective
Target Business.  We have not established any specific attributes or
criteria (financial or otherwise) for prospective Target
Businesses.  Our sole officer and director has never served as an
officer or director of a development stage public company with the business
purpose of acquiring a Target Business.  Accordingly, he may not
successfully identify a Target Business or conclude a Business
Combination.   To the extent we affect a Business Combination
with a financially unstable company or an entity in its early stage of
development or growth, including entities without established records of sales
or earnings, we may be affected by numerous risks inherent in the business and
operations of financially unstable and early stage or potential emerging growth
companies.  If we consummate a Business Combination with a foreign
entity, we will be subject to all of the risks attendant to foreign
operations.  Although our management will endeavor to evaluate the
risks inherent in a particular Target Business, we cannot assure you that we
will properly ascertain or assess all significant risk factors.





We expect
that in connection with any Business Combination, we will issue a significant
number of shares of our  common stock (equal to at least 80% of the
total number of shares outstanding after giving effect to the transaction) in
order to ensure that Business Combination qualifies as a “tax free” transaction
under federal tax laws.  The issuance of additional shares of our
capital stock:




·
            will
      significantly reduce the equity interest of our stockholders;
      and





·
            will
      cause a change in and likely result in the resignation or removal of our
      present officers and directors.





Our
management anticipates that the Company likely will be able to affect only one
Business Combination, due primarily to our financial resources and the dilution
of interest for present and prospective stockholders, which is likely to occur
as a result of our management's plan to offer a controlling interest to a Target
Business in order to achieve a tax free reorganization.  This lack of
diversification should be considered a substantial risk in investing in us,
because it will not permit us to offset potential losses from one venture
against potential gains from another.




2




Liquidity and Capital
Resources.





During
the next twelve months we anticipate incurring costs and expenses related to
filing of Securities Exchange Act reports and investigating and consummating a
Business Combination.  Management expects to fund additional costs and
expenses which may be incurred in connection with due diligence activities and a
Business Combination through loans or further investment in the Company, as and
when necessary.  We cannot provide investors with any assurance that
we will have sufficient capital resources to identify a suitable Target
Business, to conduct effective due diligence as to any Target Business or to
consummate a Business Combination.





Results of
Operations.





Since our inception, we have not
generated any revenues.  We do not expect to engage in any activities,
other than seeking to identify a Target Business, unless and until such time as
we enter into a Business Combination with a Target Business, if
ever.  We cannot provide investors with any assessment as to the
nature of a Target Business’s operations or speculate as to the status of its
products or operations, whether at the time of the Business Combination it will
be generating revenues or its future prospects.





Item
3. Quantitative and Qualitative Disclosures About Market Risk.





Not applicable.





Item
4(T). Controls and Procedures.





As
required by SEC rules, we have evaluated the effectiveness of the design and
operation of our disclosure controls and procedures at the end of the period
covered by this report.  This evaluation was carried out under the
supervision and with the participation of our management, including our chief
executive officer, who is our principal executive officer and our principal
financial officer.  Based on this evaluation,
management has concluded that the design and operation of our
disclosure controls and procedures are effective.  There were no
changes in our internal control over financial reporting or in other factors
that have materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting.





Disclosure
controls and procedures are our controls and other procedures that are designed
to ensure that information required to be disclosed by us in the reports that we
file or submit under the Securities Exchange Act is recorded, processed,
summarized and reported, within the time periods specified in the SEC’s rules
and forms.  Disclosure controls and procedures include, without
limitation, controls and procedures designed to ensure that information required
to be disclosed by us in the reports that we file under the Exchange Act is
accumulated and communicated to our management, including principal executive
officer and principal financial officer, as appropriate, to allow timely
decisions regarding required disclosure.  In designing and evaluating
our controls and procedures, our management recognized that disclosure controls
and procedures, no matter how well conceived and operated, can provide only
reasonable, not absolute, assurance that the objectives of disclosure controls
and procedures are met.  Additionally, in designing disclosure
controls and procedures, our management necessarily was required to apply its
judgment in evaluating the cost-benefit relationship of possible disclosure
controls and procedures.  The design of any disclosure controls and
procedures also is based in part upon certain assumptions about the likelihood
of future events, and there can be no assurance that any design will succeed in
achieving its stated goals under all potential future conditions.





3




PART
II — OTHER INFORMATION





Item
1. Legal Proceedings.





The
Company is not a party to any legal proceeding or litigation.





Item
1A. Risk Factors.





Smaller
reporting companies are not required to provide the information required by this
item.





Item
2. Changes in Securities and Small Business Issuer Purchase of Equity
Securities.





(a) During
the three months ended December 31 2008, the Company did not issue any
securities.





(b) None.





(c)
None.





Item
3. Defaults Upon Senior Securities.





None.





Item
4. Submission of Matters to a Vote of Security Holders.





None.





Item
5. Other Information.





None.





Item
6. Exhibits.





Exhibit
                
                Description31.1
                
                Certification
      of the Company’s Principal Executive Officer and Principal Financial
      Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, with
      respect to the registrant’s Quarterly Report on Form 10-Q for the quarter
      ended December 31, 2008.32.1
                
                Certification
      of the Company’s Principal Executive Officer and Principal Financial
      Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
      906 of the Sarbanes Oxley Act of
2002.





4





SIGNATURES





Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the
Registrant has duly caused the Report to be signed on its behalf by the
undersigned thereunto duly authorized.




DRC
      VENTURES, INC.Date:
            February 11, 2008
            
            By:
            /s/Ronald
      WilliamsRonald
      Williams, President





5